Court File and Parties
COURT FILE NO.: 03-041/20 DATE: 20200612 SUPERIOR COURT OF JUSTICE - ONTARIO
RE: The Public Guardian and Trustee, Applicant AND: Ruth Ilene Willis and Andrew Willis, Respondents
BEFORE: C. Gilmore, J.
COUNSEL: Sarah E. Jones, Counsel for the Applicant Brendan Donovan, Counsel for the Respondent Andrew Willis
HEARD: June 10, 2020
Endorsement
Overview
1This Application deals with two discrete issues; should the Respondent Andrew Willis (“Andrew”) be required to pass his accounts from January 1, 2015 or May 2, 2018; and, whether the Public Guardian and Trustee (“the PGT”) should replace Andrew as the as interim Guardian of Property for Ruth Ilene Willis (“Mrs. Willis”).
2Andrew’s position is that he should not be required to pass accounts in court form prior to the date he became his mother’s Attorney for Property. On the other issue, Andrew consents to the PGT becoming his mother’s Guardian of Property but only after the sale of her home has been completed.
Background
3Andrew is Mrs. Willis’ only living child and her current attorney acting under a Continuing Power of Attorney for Property dated May 2, 2018. Mrs. Willis is 86 years old. Her husband predeceased her.
4While clearly suffering from some cognitive deficits prior to June 2018, a consultative note from Dr. Paramsothy dated June 18, 2018 indicated that Mrs. Willis was incapable with regard to her finances and suffered from moderate to severe dementia. Mrs. Willis began living in MacKenzie Place Nursing Home as of July 27, 2018. A formal capacity assessment completed on September 24, 2018 assessed Mrs. Willis as incapable of managing her property.
5Mrs. Willis’ only asset is her home located at 76 Trailwood Crescent in Richmond Hill (“the home”). There are four mortgages totalling $3.35 million registered against the home. The last appraisal done in April 2019 estimated that the home was worth $2.8 million once renovations were complete.
6The home is currently listed for sale on MLS with a Listing Agreement in effect until July 10, 2020. During the course of the hearing Andrew’s counsel advised that an interested purchaser is returning for a third showing. Andrew has extensively renovated the home and staged it for sale. Andrew also arranged all of the mortgages on the home since 2015 which were used, according to Andrew, to help pay for the renovations.
7Andrew’s position is that he is the best person to manage the sale given his integral involvement in the renovation and marketing of the home. His view is that having the PGT take over would be of no assistance and could lead to Power of Sale proceedings being taken by one of the private mortgage lenders. He agrees to having the PGT take over as his mother’s Guardian of Property as soon as the home is sold.
8Andrew submits he is owed over $200,000 in labour for the work he has done on the home, out of pocket expenses in the range of $100,000, plus compensation for acting as his mother’s POA for Property since May 2018.
Issue # 1 – Should Andrew be Required to Provide an Accounting back to January 1, 2015.
9The PGT seeks an accounting back to January 1, 2015 in order to capture all of the mortgages which Andrew arranged on his mother’s behalf. Andrew consents to pass accounts as of May 2, 2018 when he became his mother’s POA for property.
10During the course of hearing, the PGT clarified that it was not seeking a passing of accounts prior to May 2, 2018 in court form, only justifiable explanations of money coming in and out of his mother’s RBC account and how mortgage advances were spent plus all relevant disclosure.
11Andrew objected to preparing accounts in court form prior to May 2, 2018 in large part due to the expense of doing so. It is clear from the available information that Mrs. Willis is insolvent. Andrew does not wish to incur any additional costs which he will no doubt have to fund himself.
12I agree with the PGT that one must look at the types of duties that the individual was carrying out to determine if they were acting in a fiduciary capacity. In Fareed v. Wood, 2005 CarswellOnt 2572, the court examined the services Mr. Wood was providing in the approximately 13 years prior to his appointment as POA for property. Those services included monitoring bank accounts, conferring with investment advisors and transferring funds (para 30).
13In the case at bar, Andrew assisted his mother with paying bills and arranging mortgages long before she went to MacKenzie Place. There is no doubt that even when Mrs. Willis was still capable of making decisions about her property, she was unsophisticated, reliant on Andrew and vulnerable. Andrew also had full access to her bank account well before January 1, 2015.
14Given the above, I find that Andrew has been a fiduciary for some time and likely back as far as 2008 when he told Mr. Merrick he began managing his mother’s property. As such, he should provide detailed explanations about all financial transactions upon the PGT’s request from January 1, 2015 to May 1, 2018. A Passing of Accounts in formal court form is not sought by the PGT for that period.
Issue #2 – When Should the PGT Become the Temporary Guardian of Property for Mrs. Willis?
15The only issue to decide with respect to this requested relief is whether Andrew should be permitted to complete the sale of the home or whether the PGT should be appointed immediately.
16The PGT raises several arguments in favour of an immediate termination of Andrew as POA for Property for his mother:
a. Andrew has been managing the home since he was appointed POA in May 2018 and has been the General Contractor for the renovations since 2016. The PGT is concerned that no sale has taken place during this time and that the renovations have gone on far too long. The only actual offer received has been for $2.4M. This is far below what is needed to pay out the current mortgages. The house been listed on three different occasions and during one listing period there was not a single showing. The PGT lacks confidence that Andrew will be able to sell the home for $3.5M and as such, the PGT taking over the sale will make little difference to the outcome for Mrs. Willis.
b. Andrew does not do what he says he will do. He made many promises to MacKenzie Place to pay his mother’s arrears but did not. There are still arrears owing of $15,000. Andrew has not made his mother’s needs a priority. As a result, his mother is living in a ward with other residents in a facility which has experienced COVID-19 cases and with minimal services. Mrs. Willis’ quality of life must be improved.
c. Mrs. Willis’ only current income is a $600 per month pension. She also owes $17,000 to the Canada Revenue Agency. Mrs. Willis has qualified for a survivor’s pension since her husband’s death, but Andrew did not assist her in applying for it. He only recently applied for her marriage certificate in order to move forward on applying for additional pension income for his mother in the form of GIS and CPP. The PGT could do this for Mrs. Willis on an expedited basis.
d. The PGT needs access to Mrs. Willis’ RBC account. It is clear from previous disclosure that Andrew has used this account to pay for his Granite Club fees, groceries, gas, alcohol, hockey equipment and his child support payments. While it appears that RBC has frozen this account of their own accord given their knowledge of this Application, the PGT seeks control over all of Mrs. Willis’ assets to ensure there is no more unauthorized dissipation.
17Andrew argues that appointing the PGT immediately does not meet the requirements under s. 27(1) of the Substitute Decisions Act which sets out that a temporary guardian of property is only required to prevent “serious adverse effects.” There are no such serious adverse effects to prevent in this case. In fact, given Andrew’s extensive involvement in the renovating, staging, and marketing of the home it would be detrimental to replace him as POA for Property until the home is sold.
18Andrew has done extensive and professional renovations to the home understanding that he may not be paid for them. Further, the private lender on the 3rd and 4th mortgages has made it clear that if the PGT takes over they will begin Power of Sale Proceedings as they are concerned about the protection of their security if Andrew is not involved in the sale.
19A family has requested a third showing of the home this week and Andrew is hopeful that an Offer will be received.
20Andrew has explained the delay in applying for his mother’s pensions was due to a lack of proper professional advice.
Analysis and Orders
21There is no doubt that Andrew has extensive knowledge about the home and has invested time and money into taking it from a place for his mother’s hoarding to a location that shows well based on the photographs he provided. However, Andrew has had an excessive amount of time in which to prepare the house for sale while his mother languishes in a lowered standard of living with unpaid bills and minimal care. The fact that he is the guarantor on the mortgages means he clearly wants to obtain the best possible price for the home, however, this puts him in a position of conflict which may explain the delay in the sale.
22Given the above, Andrew should be given a short window of time to complete the sale after which time the PGT should become Mrs. Willis’ temporary Guardian of Property whether the sale occurs or not.
23The Court is obliged to ensure that the focus going forward is on Mrs. Willis. It appears that Andrew has been consumed with the home renovations while paying little attention to the fact that his mother has arrears of living expenses and is not even receiving basic nail and hair care. As well, efficient application for the pensions for which she qualifies would permit her the opportunity of living in more private accommodation and reduce the obvious risks of living in a ward arrangement during a pandemic.
24Given all of the above, I make the following orders:
a. Andrew Willis shall provide a proper passing of accounts as Power of Attorney for Property for Mrs. Willis from May 2, 2018 to July 31, 2020.
b. Andrew Willis shall provide an accounting (not in formal court form) of all financial transactions related to Mrs. Willis from January 1, 2015 to May 1, 2018. The accounting must provide explanations where requested by the PGT.
c. The PGT shall be appointed as the temporary Guardian of Property for Ruth Willis as of August 1, 2020 regardless of whether the home at 76 Trailwood Crescent, Richmond Hill, has sold.
d. Andrew Willis shall continue his efforts to sell 76 Trailwood Crescent until July 31, 2020 and provide the PGT with copies of any Offers.
e. Andrew Willis shall not enter into any new Listing Agreement without the consent of the PGT.
25Andrew’s counsel advised that he would not seek any costs in this matter if successful but requests that no costs be sought against him.
26The PGT has had some success in this case, however, the issue of a passing of accounts prior to May 2, 2018 was less contested when it became clear that the PGT did not require that accounting in a formal court form.
27If the issue of costs cannot be resolved, the parties may provide written submissions of no more than two pages in length on a seven-day turnaround starting with the PGT. Costs submissions may be sent to me directly via email. If no costs submissions are received within 35 days, costs shall be deemed to be settled.
C. Gilmore, J.
Date: June 12, 2020